Treasurer Peter Costello yesterday intensified his stand-off with the Prime Minister by pointedly declining to say whether John Howard was the best man to lead the Government into the federal election.

Mr Costello determinedly ignored the question from a reporter as he went into a function, leading to highly damaging pictures across last night's television news bulletins.

While the Treasurer tested the patience of a party appalled that leadership talk is adding to its problems with a strengthening Opposition, Mr Howard angered Costello supporters by digging in further behind his line that he will stay in the job while the party wants him and it is in the party's interest.

"That was my position last June, it's my position now, it will be my position when the election campaign starts, it'll be my position on election day," he said. "I don't intend to alter in any way, because it's the truth."

In an interview with the Courier Mail, Mr Howard said: "I have no desire to retire at all. I got a clear signal from my party that they wanted me to continue. I wanted to go on and I've still got a lot of energy. I'm still fit."

The rift between Mr Costello and Mr Howard widened last week when the Treasurer repeatedly refused to rule out a challenge. Although there is no prospect of a challenge - the PM has overwhelming numbers - the leadership talk is now becoming a serious worry for senior Government and party figures.

The Government will receive another blow this morning with the latest Newspoll which has Labor ahead in primary votes and on a two-party basis. Mr Howard's rating as preferred prime minister has fallen, and Mr Latham's rating has increased, although the Opposition Leader still trails the PM, 39 to 44 per cent.

Parliamentary secretary Warren Entsch lashed out at fellow parliamentary secretary Christopher Pyne, a Costello supporter, who last Friday declared that Mr Howard had said he would hand over the leadership after the election.

Asked yesterday about Mr Pyne's comment, Mr Howard snapped: "I don't know where he got that from." Mr Entsch said it was "totally inappropriate" for Mr Pyne to try to put words into Mr Howard's mouth. "I haven't seen anything... (that) qualifies him in any way to speculate on behalf of the Prime Minister."

Mr Pyne, who rang the PM's office on Sunday to see what line was being put out after his remarks, yesterday put a fresh spin on his comments on the ABC's Lateline on Friday.

He said his remarks had been "reasonably unexceptional" and the report of them had been "a major beat-up" in The Sunday Age.

"What I was really saying was that when the Prime Minister ultimately retires at some point down the track, whenever that is, there is a general consensus in the party that Peter Costello would be his undisputed successor," he said.

Mr Howard battled to contain the leadership story, saying he did not expect Mr Costello to rule out a challenge because "we're meant to be a party that believes in competition".

Pressed after the launch of an Amnesty report, Mr Costello said he and the PM "are very good friends and colleagues".